Trump
raised tariffs on steel and aluminum imports from Brazil and Argentina. Trump alleged
tight monetary policy and stronger dollar putting pressure on US manufacturing
industry. Consequently, US dollar index fell nearly 0.5% to 97.90. Weakness in
US dollar index was further supported by weak ISM manufacturing PMI. US
manufacturing PMI printed 48.2, remained below 50 for fourth consecutive month.
Euro turned out to be the prime beneficiary of a weaker dollar as EUR/USD pair
bounced towards 1.1075.
On
domestic front, RBI will kick start its fifth Bi-monthly monetary policy of
2019-20. RBI is expected to ease further amid slowing domestic economy. Today,
RBI will conduct INR 2.6 trillion reverse repo auction to reduce excess
liquidity from the banking system. USDINR pair opened the session on a flat
note at 71.70. USDINR pair has immediate support at 71.48-50 levels and
immediate resistance at 71.78-82 levels. Range for the day 71.45-71.82.
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